Housing crisis hurts Pacific islanders in Auckland

The housing crisis in Auckland is a big problem. It’s estimated the city is short of 10,000 houses every year and it’s expected to get worse.

The shortage is happening because new houses are not keeping up with the city’s growing population.

Currently, just under 1.5 million people live in Auckland. Over the next thirty years, Auckland's population is expected to grow by 1.2 million people requiring 400,000 new houses.

The Auckland Plan says 300,000 will go within the urban boundary and 100,000 on green field land.

But for the Maori and Pacific community the impact of the housing crisis is a much bigger problem because not only is it a matter of housing availability, it is more a matter of housing affordability as the majority of them work in low paying jobs.

One real estate agent in Manurewa stated: “You’ve got to have a combined or single annual income of at least $100,000 with no external debt to have a chance of buying in this market,” Manurewa Ray White manager Sue Douglas told the NZ Herald.

Such a criterion takes house ownership beyond many Maori and Pacific island families but it is also starting to affect middle income New Zealanders. This group contains the highly skilled and educated Kiwis who wield influence on economic growth and essentially determines if Auckland becomes the globally competitive city Mayor Len Brown is preaching it to be.

If middle income Kiwis decide to leave, as many are now doing, then the long-term impacts for the region are significant as a result.

One of the major reasons for housing unaffordability is New Zealand’s growing wealth inequality between the rich and poor. A big contributor to that was when the new tax changes by the John Key government came into force on 1 October 2010.

Back then, Economist Bill Rosenberg foresaw the ‘gap’ will widen once the tax changes take effect.

He labeled the changes “unfair” and predicted it “will hit low income people hard. They will worsen New Zealand's already damaging income inequalities.”

He said one of the reasons the gap would increase is the difference in take-home pay between someone on $30,000 a year and someone on $150,000 a year growing by $102 a week as a result of the income tax cuts - a tax cut of $16.15 per week compared to one of $117.88.

Said he: “Income disparity has widened over the last 25 years and tax cuts like these only widen the gap further. It is all very well to say that the top 50 percent of income earners pay 89 percent of the income tax take, but they get 84 percent of taxable income.”